New Media Will Buy Gannett For $1.4B; Microsoft Snaps Up PromoteIQ

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Open The Gates

New Media Investment Group will buy Gannett in a deal valued at $1.4 billion. The deal is expected to close by the end of 2019. New Media is a holding company that operates 154 daily local papers across 39 states, with 52 million monthly uniques. Meanwhile, Gannett operates its flagship national publication USA Today and 109 local publications in 34 states, totaling 125 million monthly uniques. The combined entities will have the digital chops to become “a leading digital media player,” according to the press release announcing the deal. In an investor presentation, New Media anticipates annual revenues for the combined company of $4.3 billion and predicts digital advertising and marketing services revenue to hit “over $1 billion annually.” New Media’s revenue over the last 12 months (LTM) was $1.6 billion, while Gannett’s LTM revenue was $2.8 billion. Read the investor presentation.

Microsoft Goes Shopping

Microsoft is buying the retail and ecommerce ad tech company PromoteIQ, which will continue as a standalone subsidiary within Microsoft Advertising, according to a blog post by corporate VP Rik van der Kooi. Terms of the deal were not disclosed, and LinkedIn data shows PromoteIQ has between 30-40 employees. Van der Kooi writes that PromoteIQ “strategically complements Microsoft’s current retail advertising offering.” The startup has SSP-like deals with retailers, including Kroger, Kohl’s and Overstock, and an ad exchange for brands that sell in those stores, sites and apps. In 2016, Criteo acquired a similar business, HookLogic, and it’s been a growth driver as Criteo Sponsored Product ads. This isn’t the first enigmatic Microsoft advertising deal this summer, following LinkedIn’s acquisition of the cross-device company Drawbridge. Microsoft has kept mum, but these acquisitions could signal the company has expanded its ad tech ambitions since it consolidated Bing and its other ad products into Microsoft Advertising earlier this year.

Gorman FTW

Agencies credit Snap Chief Business Officer Jeremi Gorman for the company’s sales turnaround and helping to make the organization easier to navigate. Prior to Gorman’s addition last October, agency buyers considered Snap a confusing platform and partner. But in the past six months, Gorman has reorganized Snap’s sales team into a vertical structure, so account teams better understand client businesses. Snap also hosted its first partner summit in April in Los Angeles, where it offered a sneak preview of new ad products to its closest customers. Snap’s messaging to brands has also been re-tuned to focus on its Gen Z audience, rather than trying to compete with Google and Facebook on reach. “The idea that [users] value Snap in a different way allows them to have a much clearer message,” Noah Mallin, Wavemaker’s chief experience officer, told CNBC. “I think [Gorman is] certainly responsible for that.” More.

The Amazon Price

Potential Amazon antitrust enforcement has focused on how the company could use marketplace sales data to launch and promote its own products. But another concern could be its influence over pricing on other ecommerce platforms, Bloomberg reports. Amazon sellers are also on eBay, Walmart and other retailers, and Amazon scrutinizes those listings to see if prices are lower elsewhere. If so, Amazon warns the seller and removes search placements and the “buy now” button until prices are at least even. Since Amazon has an outsized share of ecommerce, most vendors keep prices lowest there, rather than take the platform penalty. This policy is particularly maddening for some sellers, because Amazon has taken increasing percentages of overall sales, and many companies could offer cheaper prices with higher profit margins on their own sites or with other retailers, but can’t risk their Amazon business. Amazon formerly required sellers to have their lowest prices on Amazon, but that policy disappeared with regulatory inquiries in 2013. More.

But Wait, There’s More

You’re Hired!

 

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